Cannabis Grower Canopy Is Said to Bid for Spain's Alcaliber

(Bloomberg) -- Canopy Growth Corp., the world's largest cannabis producer by market value, is among bidders for closely held Spanish firm Alcaliber SA, according to people familiar with the matter.

Canopy, based in Smiths Falls, Ontario, is competing against U.K. health-care investor GHO Capital and Spanish investment firm Alantra Partners SA, the people said, asking not to be identified because the deliberations are private. The producer of morphine and thebaine may be valued at about 200 million euros ($246 million) to 275 million euros in a deal, they said.

While talks continue and Alcaliber may attract more suitors, Canopy is seen as the most likely acquirer, the people said. Final bids are due in coming days, and a buyer could emerge by early April, they said.

Canopy and Alantra declined to comment. GHO didn't respond to requests for comment. Canopy's shares rose as much as 6.7 percent to C$34.55 in Toronto, the highest in five weeks.

Consolidation in the marijuana industry has increased as Canadian companies seek to gain market share domestically and abroad. While the combined domestic market for medical and recreational pot is expected to reach C$8 billion ($6.21 billion) in sales by 2021, companies such as Canopy are also looking to expand internationally.

Canadian producer Aurora Cannabis Inc. in January agreed to acquire CanniMed Therapeutics Inc. for C$1 billion in the industry's largest merger.

Alcaliber is majority owned by Spanish billionaire Juan Abello's investment fund Torreal SA, with French drugmaker Sanofi holding a 40 percent stake. Founded in 1973, it supplies narcotic raw materials based on the cultivation of the opium poppy and its transformation into poppy straw, as well as the extraction of alkaloids, according to the owner's website. Torreal declined to comment.

Canopy has more than half a million square feet of indoor and greenhouse production capacity, according to its website. Last year, alcohol giant Constellation Brands Inc. bought about 10 percent of the company, becoming its biggest shareholder.

--With assistance from Jen Skerritt

To contact the reporter on this story: Manuel Baigorri in London at mbaigorri@bloomberg.net.

To contact the editors responsible for this story: Dinesh Nair at dnair5@bloomberg.net, Simon Casey at scasey4@bloomberg.net, Patrick McKiernan

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